An empirical derivation of the industry wage equation
AbstractThis paper utilizes the Box-Cox transformation of variables technique to empirically derive an industry wage equation. Section I presents the determinants of potential wage differentials between and within industries. Section II estimates a Box-Cox industry wage equation. Likelihood ratio tests on alternative specifications of this equation affirm that competitive structure is a significant determinant of the industry wage rate and that human capital specifications of the industry wage equation (for the manufacturing sector) are not statistically valid. Section III summarizes the results.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 11325.
Date of creation: 1994
Date of revision:
Publication status: Published in Journal of Quantitative Economics 1.10(1994): pp. 155-170
Box-Cox; functional form; wage equation; labor market inequality; efficiency wage;
Find related papers by JEL classification:
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
- C52 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Evaluation, Validation, and Selection
- L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General
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